OPEC & OPEC+

Why in News?

Recently, the United Arab Emirates announced it will exit the Organisation of the Petroleum Exporting Countries (OPEC) and the broader OPEC+ alliance effective May 1, 2026.

OPEC

• OPEC – Organisation of the Petroleum Exporting Countries
• Founded in – 1960, the Baghdad Conference was established as a permanent intergovernmental organisation.
• Objective – It coordinates petroleum policies, stabilises oil markets secure fair returns for producers and investors.
• Founding Members – Iran, Iraq, Kuwait, Saudi Arabia, Venezuela.
• Current Members (2026) – Algeria, Congo, Gabon, Equatorial Guinea, Iraq, Iran, Kuwait, Libya, Nigeria, Saudi Arabia, UAE (exiting May 1), Venezuela.
• Secretariat – Vienna, Austria.
• Structure – It consists of
  • Secretariat (executive body)
  • Conference (main policy-making body, meets every 6 months).
  • Board of Governors (budget and oversight).
• Decision Principle – One member, one vote; unanimity required.
• OPEC Fund for International Development, 1976 – A multilateral development finance institution created by OPEC member countries in 1976 to channel financial assistance from oil‑exporting nations to non‑member developing countries.
• Significance – It holds 80% of the world’s proven crude oil reserves.
• India’s Dependence – Sources 70% crude oil, 60% LPG, 30% LNG, and 45% petroleum products demand from OPEC.
• Publication – World Oil Outlook.

OPEC+

• Established – 2016, also called the Vienna Group.
• Composition – OPEC + 10 non‑OPEC exporters include Russia, Mexico, Oman, Kazakhstan, Azerbaijan, Brazil, Malaysia, Bahrain, Brunei, South Sudan and Sudan.
• Contribution – Pumps 40% of global crude oil.
• Mechanism – Declaration of Cooperation for production adjustments to stabilise markets.
• Coordination – It relies heavily on Saudi Arabia (the largest OPEC producer) & Russia (the largest non-OPEC producer).
• Decisions often reflect geopolitical tensions, e.g., Russia’s war in Ukraine influenced the 2022 cut of 2 million barrels/day.

Quick Fact

Reference

DD News | OPEC